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QUESTION 2 What is the forward exchange rate? The price of one currency in terms of another today The price of one currency in terms of another in the future The price of one asset value in terms of another today The price of one asset value in terms of another in the future QUESTION 3 What is international trade? O Exchange of goods and services between people in different nations Exchange of goods and services between firms in different nations Both of the above QUESTION 4 What is a tariff? Tax on imports Government limits on quantity that can be imported Clause in the US that limits restrains of trade between states None of the above QUESTION 5 What is a quota? Tax on imports Government limits on quantity that can be imported Clause in the US that limits restrains of trade between states None of the above QUESTION 7 How do we define the value of the next best forgone alternative not chosen? Spot exchange rate Inflation rates Opportunity cost Tariffs QUESTION 8 What is a capital abundant economy? O A higher level of capital per worker A lower level of capital per worker Production that require a high level of capital Production that requires a low level of capital QUESTION 11 What is a labor abundant economy? A higher level of capital per worker A lower level of resources per worker Production that require a high level of capital Production that requires a low level of capital QUESTION 14 What are ad valorem tariffs? O A tax on imports as a percentage of the import value O A tax on imports proportional to the number of units imported An import tax required to raise revenue O Set of tariffs that raise tariff level to 59% QUESTION 15 What are specific tariffs? O A tax on imports as a percentage of the import value A tax on imports proportional to the number of units imported An import tax required to raise revenue Set of tariffs that raise tariff level to 59% QUESTION 16 What are revenue tariffs? O A tax on imports as a percentage of the import value A tax on imports proportional to the number of units imported An import tax required to raise revenue Set of tariffs that raise tariff level to 59% QUESTION 17 What are Smoot-Hawley tariffs? O A tax on imports as a percentage of the import value O A tax on imports proportional to the number of units imported An import tax required to raise revenue O Set of tariffs that raise tariff level to 59% QUESTION 19 What is depreciation? O An increase in value of a currency O A decrease in value of a currency QUESTION 20 What is appreciation? An increase in value of a currency O A decrease in value of a currency QUESTION 21 What is the law of one price? Theory that states that the same commodity in two countries will sell for the same amount when measured in the same currency O Theory that states that different commodity in two countries will sell for the same amount when measured in the same currency Theory that stated the exchange rate will adjust to equality the price levels of two countries O Theory that states that the same commodity in two countries will sell for the same amount when measured in different currencies QUESTION 22 What is the purchasing power parity theory? O Theory that states that the same commodity in two countries will sell for the same amount when measured in the same currency Theory that states that different commodity in two countries will sell for the same amount when measured in the same currency O Theory that stated the exchange rate will adjust to equality the price levels of two countries Theory that states that the same commodity in two countries will sell for the same amount when measured in different currencies